The Underrated Tech Powerhouse: Israel's Web3 Unicorn Rise
TechFlow Selected TechFlow Selected
The Underrated Tech Powerhouse: Israel's Web3 Unicorn Rise
As global demand for decentralization continues to grow, Israel's Web3 sector will keep attracting more investment and entrepreneurs, becoming one of the world's leading Web3 innovation hubs.
Navigating Web3 tides with focused insightsIsrael is gradually becoming a Web3 startup nation, having already created hundreds of new jobs within its rapidly growing blockchain ecosystem.
With a vibrant entrepreneurial environment, Israel has earned its reputation as the world’s startup capital, home to 97 unicorns (privately held companies valued at over $1 billion) and boasting the highest density of startups per capita. In 2021, more than $2.5 billion was invested in Israeli startups, setting a record for the country.
Equipped with a deep talent pool in technology, a dynamic startup culture, and world-class venture capital firms, Israel is an ideal destination for blockchain innovation and holds immense potential in the future development of Web3.
Moreover, the Israeli government is actively promoting digital transformation and supporting the development of blockchain and cryptocurrencies. As global demand for decentralization continues to grow, Israel's Web3 sector will continue attracting more investment and entrepreneurs, positioning itself as one of the leading global centers for Web3 innovation.
What surprises me most is that Israel is home to renowned cryptographers such as Eli Ben Sasson, Shaffi Goldwasser, Yehuda Lindell, Aviv Zohar, and Eran Tromer—key pioneers behind revolutionary technologies like MPC and ZKP.
The image below illustrates Israel’s Web3 project ecosystem. Next, I will select three of the most representative Web3 companies from this map to help readers understand this formidable Web3 technological powerhouse.
Fireblocks – One of Israel’s Highest-Valued Blockchain Security Companies
Founded in 2018, Fireblocks’ core technology products consist primarily of Fireblocks Network and MPC-based wallet infrastructure.
Fireblocks is a platform that secures digital assets in transit, focusing on protecting clients’ digital assets during transfers between exchanges, OTC brokers, and other counterparties.
Fireblocks enables banks, fintech firms, exchanges, liquidity providers, OTC desks, and hedge funds to securely manage digital assets across a wide range of products and services.
Between 2018 and 2019, Israeli security engineers Michael Shaulov, Idan Ofrat, and Pavel Berengoltz co-founded Fireblocks, with Shaulov serving as CEO. All three founders have been active in the cybersecurity field for the past 20 years.
Prior to joining Fireblocks, Michael Shaulov co-founded Lacoon Mobile Security, which was later acquired by Check Point.
What prompted them to start this venture? It traces back to 2017 when the Lazarus Group hacked four South Korean exchanges and stole $200 million worth of Bitcoin.
At the time, Michael Shaulov was working at Check Point and was part of a task force investigating large-scale cyber breaches.
During the investigation, two things became clear: cybercriminals were shifting from traditional financial systems to digital assets, and there was a lack of effective solutions for securing digital assets in enterprise environments.
Thus, the next challenge was obvious—ensuring blockchain security. This led Michael Shaulov, along with Idan Ofrat and Pavel Berengoltz, to co-found Fireblocks.
To date, Fireblocks has raised five funding rounds:
June 2019: Series A raised $16 million;
November 2020: Series B raised $30 million, with Paradigm participating;
March 2021: Series C raised $133 million, backed by Ribbit Capital, Coatue, and Stripes;
July 2021: Series D raised $310 million, led by Sequoia Capital, reaching a $2.5 billion valuation;
December 2021: Series E raised $550 million, including D1 Capital Partners, achieving an $8 billion valuation.
Fireblocks’ valuation surged threefold within just six months and is now one of Israel’s three highest-valued private companies.
Secret Network – The First Privacy-Preserving Smart Contract Chain Based on Cosmos
Secret Network is the first privacy-preserving smart contract public chain built on the Cosmos technology stack, combining smart contract deployment, privacy features, and Cosmos’ scalability and interoperability.
Built using the Cosmos SDK and Tendermint Core consensus mechanism, Secret Network is a Layer 1 privacy chain that achieves cross-chain interoperability via the IBC protocol with other Cosmos SDK chains that have enabled IBC.
Secret Network ensures data privacy through key components: encrypted smart contracts (Secret Contracts) and Trusted Execution Environments (TEE).
The founding team is SCRT Labs, with members including Guy Zyskind (Founder & CEO), Itzik Grossman (Vice President of Engineering), Nir Zyskind (Director of Operations and Business Development), Assaf Morami (Lead Software Engineer), Tom Langer (Senior Software Engineer), among others.
Founder Guy earned his bachelor’s degree in Electrical Engineering and Computer Science from Tel Aviv University and completed his master’s at MIT Media Lab. He co-founded SCRT Labs in June 2016, serving as CEO.
Privacy will become increasingly important in the future, representing a massive fundamental demand, making it highly likely for major breakthroughs (Alpha) to emerge from the privacy sector.
Currently, the biggest issue in the privacy space isn’t privacy itself, but rather the high cost, low efficiency, and poor user experience associated with preserving privacy—reasons why many privacy technologies remain underutilized.
Therefore, Secret Network, as the first smart contract chain with native privacy capabilities, brings new possibilities to the industry.
As the first privacy chain within the Cosmos ecosystem and currently the most developed in terms of ecosystem growth, Secret Network focuses on privacy functionality to build dedicated infrastructure for the Web3.0 era. It has already established robust cross-chain bridge infrastructure, with its ecosystem steadily expanding.
To date, Secret Network has raised two funding rounds:
May 6, 2021: Raised $11.5 million in strategic funding from Arrington XRP Capital, Blocktower, Spartan Group, Skynet Trading Ltd.
January 19, 2022: Announced a $400 million ecosystem fund backed by SCRT Labs, DeFiance Capital, Alameda Research, CoinFund, HashKey Group, Hashed, Arrington XRP Capital, Dragonfly, Fenbushi Capital, Skyvision Capital, Blocktower, Terraform Labs, Hartmann Ventures, NGC Ventures, Figment, and ArkStream.
Starkware – A Layer 2 Unicorn Whose Valuation Increased by $6 Billion in Six Months
StarkWare, a blockchain privacy solutions provider headquartered in Netanya, Israel, was co-founded by Eli Ben-Sasson and Alessandro Chiesa, who are also co-founders of Zcash.
Its primary goal is to further promote zk-STARKs, a groundbreaking blockchain privacy solution developed at the Technion – Israel Institute of Technology.
Building upon zero-knowledge proof protocols to protect information privacy on blockchains, StarkWare can compress vast amounts of data into smaller samples.
Additionally, it offers greater efficiency, transparency, and security compared to quantum computing. A key advantage is its ability to verify private information while ensuring computational integrity without requiring massive computational power.
StarkWare currently offers two main products:
1. StarkEx provides customized B2B services for applications, allowing apps running on StarkEx to customize their business logic.
StarkEx serves DeFi and gaming applications, accelerating transaction speeds, reducing fees, and enabling data availability via either ZK-Rollup or Validium models.
2. StarkNet is a permissionless, decentralized, and censorship-resistant general-purpose Layer 2 network where any user or developer can deploy smart contracts written in the Cairo programming language.
These two products represent distinct business models: the former sells customized services to applications, while the latter offers a permissionless general-purpose service, earning revenue through transaction fees or capturing MEV as a node prioritizing transaction ordering.
StarkWare’s team is based in Israel, composed primarily of computer scientists and cryptographers from Hebrew University and the Technion. It is arguably the strongest team in the field of zero-knowledge proofs.
According to StarkWare’s official website, the team currently consists of 77 members, plus 7 academic advisors and 5 additional advisors. Key members include:
Eli Ben-Sasson: Co-Founder & Chief Scientist, holds a Ph.D. in Theoretical Computer Science from Hebrew University, and is a professor of Computer Science at the Technion. Founding scientist of Zcash and inventor of zkSNARKs and zkSTARKs.
Uri Kolodny: Co-Founder & CEO, holds a Bachelor’s in Computer Science from Hebrew University, a seasoned entrepreneur with strong collaboration skills.
Alessandro Chiesa: Co-Founder & Chief Scientist, professor of Computer Science at UC Berkeley, founding scientist of Zcash, co-inventor of zk-SNARKs, and core developer of libsnark, a leading open-source library for succinct zero-knowledge proofs.
Michael Riabzev: Co-Founder & Chief Architect, Ph.D. from the Technion, formerly worked at Intel and IBM.
Oren Katz: Vice President of Engineering, graduated from Hebrew University in Computer Science and holds an MBA from Tel Aviv University, with over 20 years of engineering experience.
In terms of fundraising, StarkWare has disclosed seven funding rounds involving 45 investments, with publicly reported funding totaling $273 million.
On May 25, 2022, StarkWare, the zero-knowledge proof developer behind Ethereum’s Layer 2 scaling solution StarkNet, closed a $100 million Series D round at an $8 billion valuation, surging ahead in the race for Ethereum scalability.
Notably, in November 2021, StarkWare had just completed a $50 million Series C round led by Sequoia Capital at a $2 billion valuation. That means in just six months, its valuation quadrupled—an increase of $6 billion.
Recently, with Ethereum’s series of upgrade plans reigniting interest in Layer 2 solutions, and given StarkWare’s technological superiority, I am highly optimistic about the long-term prospects of zk-Rollups and STARKs.
In the future, as token incentives take effect and the network gradually decentralizes, StarkWare will be one of the strongest contenders in the Rollup space.
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
